(2-5-14) With the recent downturn in the market, what everybody wants to know -- is this just a 5-10% correction or is this the beginning of something bigger?

The problem is that the "sugar" drip in the market, i.e. the quantitative easing, has masked festering problems for the last 5 years which have not been addressed and consequently when you begin to withdraw the "sugar" those problems that are most severe become the problems that surface first.

First there's the problem with emerging markets, which we discussed in last weekâ€™s missive, namely emerging markets' currency and emerging market debt.

This was a problem that had existed and what was from September 2008 when the "sugar" drip began until now was the problem that 3rd world nation-states didnâ€™t address.

So what everybody wants to know is -- what's the next shoe to drop?

In other words, knowing the problems that were being covered up by the sugar drip -- the question becomes where do we go from here?

You can tell where the center of the problems is by looking at the distribution of the decline in markets that has occurred across the planet which has been concentrated in the Asian markets.